Executive Benefits/COLI/ICOLI/BOLI


Executive Benefits

Whether rewarding individuals, retaining top performers or differentiating incentives for executives, companies need a customized plan. We oversee more than $2.5 billion in executive benefit plan assets, with clients ranging from Fortune 1000 to mid-market growth companies. We begin every engagement by listening to your goals and challenges, considering what your competitors are doing and understanding your needs. We then present innovative, customized solutions designed to meet the goals of plan participants, corporate management and shareholder owners.

We provide sound advice and insight from years of experience, including:

  • Nonqualified deferred compensation plans and nonqualified defined benefit plans
  • Supplemental executive retirement plans (SERPs)
  • Phantom stock and stock appreciation rights (SARs) plans
  • Performance unit plans (PUPs)
  • Supplemental disability plans to cover gaps from group plan limits
  • Executive life insurance plans

In addition to plan design and implementation, we also offer oversight and accountability for the following:

  • Operational compliance with law and regulations, including 409A
  • Participant education and communication
  • Record-keeper selection and rabbi trustee selection
  • Total program outsourcing for plan sponsor



Corporate-Owned Life Insurance (COLI) is a product based on life insurance tax code, designed as an investment platform for corporations to fund nonqualified executive benefit plans. COLI programs are typically designed with the lowest possible face amounts to qualify as life insurance, helping to minimize insurance charges and maximizing return.

COLI provides plan sponsors with the ability to avoid tax cost, optimize profit and loss, and target program cost recovery through the tax-free death benefits received by the plan sponsor. We monitor and review annually to keep performance on track and exceed expectations.

Although COLI is a highly prevalent funding vehicle due to its unique tax and accounting characteristics, it can be complicated to manage without proper oversight. We help educate our clients about the intricacies of COLI and how it can be used to fund executive benefits as part of a self-sustaining executive benefits program.



ICOLI is corporate-owned life insurance used by insurance companies to finance the cost of benefit programs. A successful ICOLI program is the strategic positioning within your broader asset allocation strategy. Since all programs are unique and your needs differ depending on assets, we work closely with your organization to assure your program is customized to your needs. For example, consideration can be given to those assets that exhibit characteristics of lower tax efficiency and/or provide greater flexibility to implement strategic and tactical allocation decisions without tax implications.

We have been working with insurance companies for more than 20 years using corporate owned life insurance (ICOLI) programs to offset corporate benefit costs and drive increased profit and loss while reducing reserve requirements. While these programs allow insurance companies to offset benefit costs, they are becoming highly prevalent due to these two core characteristic benefits:

No.1: ICOLI Receives Favorable Tax Treatment. Earnings on assets such as cash value growth held inside insurance policies are not subject to tax and ultimately paid to the insurance company in the form of tax-free death benefits. These investments include a broad universe of high quality traditional and alternative asset classes and managers, and access to general account portfolios to produce attractive/stable current yield.

No. 2: Favorable Capital Treatment (RBC). ICOLI assets have an NAIC risk-based capital (RBC) risk weight of 5% for P&C companies and 0% for Life & Health companies, regardless of underlying assets compared to 20%-40% risk weights for many investments currently on the balance sheet like equities and Schedule BA assets.

The market has recently changed, becoming more transparent, with lower costs, and focused on private placement-based COLI products to give you the freedom to make customized investment selections. Pinnacle can help keep you up to date.



Bank-owned life insurance (BOLI) can be used as a tax-efficient method for offsetting the costs of employee benefit programs. The cash value growth in the policy is tax-deferred (tax-free if held until death) and the death benefits received are tax free. The policies insure the lives of key employees.

Our BOLI services include:

  • Research and analysis including peer review to determine what the competition is doing
  • Program design, financial analysis and evaluation
  • Insurance carrier and product comparison of alternatives
  • Compliance
  • Plan participant education and communication
  • Program implementation
  • Record-keeper and rabbi trustee selection
  • Ongoing oversight, plan consulting and board of directors management including annual board report
  • Pinnacle can also provide a diagnostic review and analysis of your existing BOLI program to ensure it is compliant, financially optimal and meeting the goals of plan participants and shareholders.
For more information on COLO/ICOLI, BOLI and other executive benefits,
please contact David Hauptman, Managing Director, at dhauptman@e-pfg.com, 914.419.0100.